Binance users in Hong Kong have become the latest target of fraudsters, which has even forced the local police to issue a warning. In the last two weeks, at least 11 Binance customers in Hong Kong lost more than $446,000 (HKD 3.5 million) in a wave of phishing scams sent through text messages.

A Wave of Phishing Scams in Hong Kong

According to Hong Kong police, Binance customers received a text message to verify their account before the deadline with a phishing link in it.

“Recently, fraudsters posing as Binance sent text messages claiming that users must click the link in the message to verify their identity details before a deadline, otherwise their account would be deactivated,” the warning of Hong Kong police from its Facebook page dubbed “CyberDefender” stated.

When the victims click the phishing link and enter the credentials to ‘verify’ their accounts, the fraudsters gain full access to their Binance account and drain the funds. The modus operandi echoes any typical phishing scam.

Changpeng Zhao, the Founder and CEO of Binance, also warned customers with a tweet.

Beware of scammers. Stay #SAFU! pic.twitter.com/XZMDMKkBJf

— CZ 🔶 Binance (@cz_binance) October 9, 2023

The Turbulent Crypto Industry in Hong Kong

The crypto industry in Hong Kong is already in turmoil after the fraudulent offering by JPEX emerged. Losses from that exchange balloon to an estimated $180 million as local police received complaints from more than 2,300 victims of the exchange.

The JPEX scandal resulted in several arrests in Hong Kong and forced the authorities to enhance their actions against illegal crypto offerings.

Hong Kong’s Securities and Futures Commission already mandated the licensing of all crypto exchanges operating within its jurisdiction. The regulatory framework kicked in earlier this year, but to date, only two exchanges, HashKey and OSL, have received a license.

Several other crypto exchanges in Hong Kong also applied for the license. Although JPEX heavily advertised that it had applied for the Hong Kong license, it did not submit any application to the local regulator. After this fiasco, the SFC issued a complete list of companies seeking the crypto license and broadened its list of suspicious platforms.